ISLAMABAD: Pakistan’s military is taking a key role in the development of one of the world’s biggest untapped copper and gold deposits, which is currently stalled by a multi-billion dollar legal wrangle with foreign mining firms, multiple sources familiar with the situation said.
The Reko Diq mine has become a test case for Prime Minister Imran Khan’s ability to attract serious foreign investment to Pakistan as it struggles to stave off an economic crisis that has forced it to seek an International Monetary Fund bailout.
Ten current and former provincial and federal government officials and mining sources familiar with the project in the Baluchistan region say the military has become the most important voice on the future of Reko Diq, which it sees as a strategic national asset.
The military will not only be in a position to decide which investors develop the deposit, but an army-controlled engineering firm, Frontier Works Organization (FWO), is positioning itself to be a member of any consortium involved, these people said.
“This has been taken over by GHQ,” said a senior Baluchistan government official, referring to the Pakistan army’s General Headquarters in the garrison city of Rawalpindi.
In a statement in response to Reuters’ questions about its role in Reko Diq, the military spokesman’s office said: “(The military) may only participate in government’s plan of development of Reko Diq, as per national requirements.”
But it acknowledged that FWO, best known for building roads through Pakistan’s rugged and lawless border regions, has developed “substantial” mining capability in recent years and would be interested in taking a role in the project.
“If an opportunity arises of participating in developing Reko Diq, FWO may work at par with other competitors (or) companies provided the project is financially viable (or) suitable,” the statement said. When asked, a spokesman declined to elaborate on the statement.
Pakistan’s Information Minister Fawad Chaudhry said civilian authorities in the insurgency-hit southwestern province of Baluchistan were in charge of Reko Diq and, along with Khan, would take a decision, but added that the military “and all other stakeholders are obviously important players.”
FWO referred questions to the military spokesman’s office. Khan’s spokesman Iftikhar Durrani said Baluchistan province was in charge of Reko Diq, and referred questions to the provincial government and the military spokesman’s office.
The manoeuvring behind the project shows how the military, which has historically dictated Pakistan’s security and foreign policy, is leveraging its sway over the civilian government at federal and provincial level to carve a growing role in the nation’s business affairs.
“The military has taken a front seat,” said Ayesha Siddiqa, author of the book “Military Inc.,” which analyzes the army’s business interests and influence in Pakistan.
“They’ve understood that the economy is important for having a strong military,” she said. “Control of the economy also gives the military a handle over expanding their business interests.”
TALKS
Buried at the foot of an extinct volcano near the frontier with Iran and Afghanistan, the mine’s development has long been delayed by a dispute with previous investors in the project, Canada’s Barrick Gold and Chile’s Antofagasta.
The government is urgently trying to settle the dispute as a World Bank arbitration tribunal, which ruled against Pakistan in 2017, is in the next few months expected to announce how much in damages the country must pay to the foreign firms, who are claiming more than $11 billion.
The dispute relates to the withholding of a mining lease.
Islamabad is also trying to find new partners to invest in the project.
But any new investors will need the blessing of Pakistan’s military, according to government officials and mining sources.
State-run companies from resource-hungry China have long coveted Reko Diq and more recently Saudi Arabia has shown interest, according to Pakistani officials.
Some Western diplomats say the Reko Diq dispute has been a significant foreign investment deterrent, with international businesses unnerved at how Pakistan dealt with the companies that had pledged to invest $3.3 billion to develop the country’s then-biggest mining project.
Barrick Gold and Antofagasta, whose joint venture Tethyan Copper Company (TCC) discovered vast mineral wealth in Reko Diq, say they had invested more than $220 million by the time the Baluchistan government, in 2011, unexpectedly refused to grant them the critical mining lease needed to keep operating.
Pakistan argued its move was legitimate because TCC’s feasibility study was incomplete and the country’s Supreme Court voided the deal in 2013. But in 2017 the World Bank’s International Center for Settlement of Investment Disputes (ICSID) ruled against Pakistan.
TCC did not respond to requests for comment and Antofagasta and Barrick Gold both declined to comment. Reuters could not determine whether either company would be willing to return to the project.
FOREIGN INVESTORS
The last serious attempt at settling the Reko Diq case was scuppered in 2016 by the military, which vetoed paying hundreds of millions of dollars to TCC, according to a senior Baluchistan official and two former senior officials in Islamabad.
But the military has since changed its stance and is more open to a settlement with TCC, according to a lawmaker close to the military and a source close to Prime Minister Khan. The military was also involved in appointing Pakistan’s current legal team.
In response to a Reuters question about blocking the previous settlement effort, the military said: “Let’s see how the case progresses.” It did not elaborate or comment on whether it was playing any role in the latest negotiations.
Some mining experts say a likely solution would be for a new investment consortium to pay the settlement fee on behalf of cash-strapped Pakistan in exchange for future royalty fees or mining rights.
Information Minister Chaudhry said Pakistan was engaged in negotiations with “both” the current investors about a settlement and also potential new investors, with interest coming from the Middle East and Europe. He declined to name the potential investors.
Pakistani Finance Minister Asad Umar said in October that Saudi Arabia has inquired about investing in Reko Diq and another government official confirmed talks were ongoing.
Saudi Arabia did not respond to a Reuters request for comment on Reko Diq. During Crown Prince bin Salman’s visit to Pakistan last month, the kingdom pledged to invest $2 billion in mineral development projects, though the provisional agreements were vague and did not mention any specific projects.
China’s state-owned miner China Metallurgical Group Corporation (MCC), which operates the Saindak copper and gold mine close to Reko Diq, has been eyeing the bigger deposit for more than a decade, according to mining and MCC officials.
A few years ago Chinese state giant Norinco also made an approach, according to two sources familiar with Norinco’s offer.
MCC and Norinco did not respond to requests for comment.
When a mining company approached former general Abdul Quadir Baloch about Reko Diq around 2016, when he was federal minister for the frontier regions, he took their proposal not only to then-premier Nawaz Sharif, but also to the army chief.
“The military has to give a (security) guarantee to any company coming in to explore or exploit this project, so they are a stakeholder,” said Baloch.
The military declined to comment on Baloch’s assertions. Sharif, who has since been jailed on corruption charges, could not be reached for comment.
The army-run FWO does not have the funds or the expertise to develop the Reko Diq project, which boasts 5.9 billion tons of ore. But it could be part of a consortium alongside global miners who have the know-how to mine such a gargantuan deposit.
The military’s role in developing natural resources in Baluchistan also carries risks, however, analysts say.
Indigenous Baloch people view outsiders with suspicion, and their anger about Islamabad exploiting the province’s vast natural resources has been one of the key themes fueling a separatist insurgency that began around 2004.
Pakistan military eyes key role developing giant copper and gold mine
Pakistan military eyes key role developing giant copper and gold mine
- Buried at the foot of an extinct volcano near the frontier with Iran and Afghanistan, Reko Diq has world’s biggest untapped copper and gold deposits
- The project boasts 5.9 billion tons of ore inviting foreign investors
Pakistan Association Dubai hosts climate action event to promote sustainable solutions
- Pakistan is counted among world’s Pakistan is counted among world’s most severely threatened countries due to climate change effects most severely threatened countries due to climate change effects
- Event brings together climate activists, advocates and youth leaders to discuss climate challenges
ISLAMABAD: The Pakistan Association Dubai (PAD) this week organized a climate action event in the city to promote sustainable solutions and highlight the dangers of deteriorating weather patterns, the Pakistani embassy in the UAE said.
The event on Friday was a collaboration between community climate action platform Extreme Hangout Dubai, social enterprise Earth Warriors and the Pakistan Youth Forum.
It featured climate advocates and members of the Pakistani community in the UAE, and Pakistan’s Consul General in Dubai Hussain Muhammad.
“Pakistan remains committed to be part of the solution,” Muhammad was quoted as saying by the Pakistani embassy in UAE. “However, global solidarity, climate finance, and technology transfer are essential to tackling this crisis.”
The event featured entrepreneurial stalls showcasing innovative eco-friendly solutions, keynote speeches and panel discussions by experts, activists and youth leaders who engaged in insightful discussions on climate action strategies and the importance of collective efforts.
The event also included performances and artistic presentations highlighting the beauty of nature and the necessity of preserving it for future generations.
“The Consul General encouraged the Pakistani community in the UAE to act as global ambassadors for Pakistan’s climate challenges through storytelling, social media and community engagement to raise awareness and bring change,” the embassy’s statement said.
The South Asian country is counted among the most severely threatened countries in terms of climate–induced challenges, especially in the context of its dependency on climate-sensitive sectors such as agriculture, water, natural resources and the environment, and socio-economic issues such as poverty.
Unusually heavy monsoon rains and melting of glaciers in June 2022 triggered flash floods across the country which killed over 1,700 people and dealt damages to critical infrastructure across the country.
Pakistan estimates damages from the floods to be around $33 billion.
Over 3,000 Pakistani, overseas athletes expected to take part in Islamabad Marathon today
- Marathon to feature five categories: full marathon, half marathon, children’s race, family race and senior race
- A prize money of Rs1 million [$3594] has been allocated for winners of all categories, says marathon organizer
ISLAMABAD: Over 3,000 athletes from Pakistan and abroad are expected to take part in a running marathon in Pakistan’s capital today, Sunday, state-run media reported.
Organized by the Islamabad Run With Us (IRU) running community in the capital, the marathon will feature five categories: a full marathon, a half marathon, a children’s race, a family race and a senior race.
The IRU says it has organized over 700 complimentary community events and numerous races, adding that it launched the Islamabad Marathon event in 2020.
“Founder of the Islamabad Run with Us community, Qasim Naz announced on Friday that the fifth Islamabad Marathon will take place on January 26, with the participation of over 3,000 athletes from across Pakistan and abroad,” state-run Associated Press of Pakistan (APP) said.
Naz said a prize money of Rs1 million [$3594] has been allocated for winners of all categories of the marathon.
The marathon kicked off at the city’s newly built Iran Avenue at 9:00 am. Its route includes the GT Road and runners will have to return to the starting point, the organizer said.
Naz said a pitch system would be introduced to ensure transparency, enabling real-time tracking of athletes and accurate identification of winners.
“He said that the purpose of organizing the event is to showcase Pakistan’s soft image and highlight the country’s beauty to the world,” APP said.
Naz said arrangements for medical and other facilities for participants have been made with cooperation from the district administration and police.
Pakistan says won’t risk rushing Saim Ayub’s recovery for Champions Trophy
- Saim Ayub was ruled out of competitive cricket for six weeks after suffering ankle injury this month
- Left-handed batter will enter recovery phase in a day or two, says PCB Chairman Mohsin Naqvi
ISLAMABAD: Pakistan Cricket Board (PCB) Chairman Mohsin Naqvi said on Sunday that he will not risk injured batter Saim Ayub’s future by rushing his recovery for the sake of the multi-nation Champions Trophy tournament, which is scheduled to get underway in Pakistan and Dubai next month.
Ayub, one of Pakistan’s most in-form batters who helped the team secure a historic ODI series whitewash over South Africa in December, suffered a right ankle fracture while fielding in the second Test against South Africa this month.
The injury forced Ayub out of competitive cricket for six weeks, dealing Pakistan a massive blow before it hosts the multi-nation Champions Trophy tournament in February. Ayub is currently in London seeking treatment as Pakistan hopes the star batter recovers in time for the crucial tournament.
“I am in contact with Saim on almost a daily basis. His rehab is going on and god willing, the plaster on his foot will be removed in a day or two after which he will enter the recovery phase,” Naqvi told reporters.
“It will take time, I don’t want to put his future at risk because of one Champions Trophy.”
The PCB chairman said he was monitoring Ayub’s rehabilitation himself, adding that Ayub was Pakistan’s asset and would soon make a full recovery.
Pakistan will play the Champions Trophy tournament opener on Feb. 19 against New Zealand in the eastern city of Lahore.
Pakistan expresses desire to formulate joint plan to combat ‘terrorism’ with US
- Interior Minister Mohsin Naqvi met US lawmakers, investors in Washington this week to discuss bilateral issues
- Pakistan has faced a surge in militant attacks in its western provinces bordering Afghanistan since November 2022
ISLAMABAD: Pakistan’s Interior Minister Mohsin Naqvi said on Sunday that Islamabad wanted to formulate a comprehensive plan with American politicians to combat “terrorism,” amid Islamabad struggle to contain surging militant attacks on its soil in recent months.
Islamabad and Washington have shared a complicated history when it comes to bilateral ties. Both countries shared close defense and security cooperation in the past, particularly during the Cold War after the 1979 Soviet invasion of Afghanistan and post-September 11, 2001 attacks.
However, more recently, US officials criticized Pakistan for not sufficiently supporting their military efforts against the Taliban following the 9/11 attacks. Islamabad denies sheltering Taliban fighters and helping them regain control of Afghanistan in August 2021.
Pakistan has faced a surge in militant attacks in its western provinces bordering Afghanistan since November 2022, ever since its truce with the Pakistani Taliban broke down. Islamabad blames Afghan rulers for providing sanctuaries to militants to launch attacks against Pakistan, charges the Taliban government vehemently denies.
“See the main purpose of my visit this time [to the US] was to make a comprehensive plan against terrorism with the politicians here,” Naqvi told reporters in Washington.
Naqvi is in Washington where he met US lawmakers this week to hold talks on issues of bilateral concern between the two countries.
“The terrorism that we are suffering is not just our fight, it is everyone’s fight,” he added. “Both 2023 and 2024 were bad years for us but you will see that whosoever takes up arms against Pakistan will suffer a bad fate.”
On Saturday, the Pakistani interior minister visited the United States Chamber of Commerce in Washington where he spoke to a delegation of the US-Pakistan Business Council.
Naqvi invited American investors to invest in Pakistan’s priority sectors, particularly in IT and minerals, state broadcaster Radio Pakistan said.
“Talking to a delegation of the US-Pakistan Business Council during his visit to United States Chamber of Commerce in Washington, he highlighted Pakistan’s mining and IT sectors have emerged as investors’ ultimate destination,” it added.
Citing Pakistan’s recent economic gains, Naqvi said the country is heading toward economic stability “rapidly,” adding that all economic indicators have improved.
Pakistan okays increase in gas prices for industries
- The decision aims to ensure required revenue for the gas sector during the fiscal year ending on June 30
- A cabinet committee turns down Petroleum Division summary to increase the tariff for domestic consumers
ISLAMABAD: The Economic Coordination Committee (ECC) of Pakistan’s federal cabinet has approved an upward revision in gas tariff for industries, the Finance Division said on Saturday.
The development came after an ECC meeting to discuss a summary submitted by Petroleum Division for an upward revision of the indigenous gas tariff for industry, or captive power plants, as well as non-protected domestic slabs.
A captive power plant refers to an electricity generation facility owned and operated by a specific industrial or commercial entity to primarily power their own operations, rather than selling electricity to the public grid. It’s dedicated to supplying electricity solely for the needs of the company that owns it, like a large factory or industrial site, minimizing reliance on the national power grid.
While the committee approved a revision in prices for industrial consumers, it declined to increase the tariff for domestic consumers to protect them from additional burden, according to the Finance Division.
“The ECC, following a through discussion, decided to approve upward revision in gas tariff for captive power plants from Rs3,000 per mmbtu (metric million British thermal unit) to Rs3,500 per mmbtu to ensure required revenue for the gas sector during FY2024-25,” the Finance Division said in a statement.
Pakistan’s caretaker government increased the prices of natural gas by up to 67 percent for residential consumers in February 2024, in a bid to meet one of the key fiscal tightening conditions of the International Monetary Fund (IMF) for a final review of its last bailout program, worth $3 billion, that helped saved the country from a default.
In August last year, Petroleum Minister Musadik Malik had said his government would keep the gas prices unchanged until winter months of December 2024 and January 2025, amid rising costs of living in Pakistan at the time.
Pakistan, which imports most of its energy needs, saw days of protests in July and August 2024 over the rising costs of living, mainly fueled by energy price hikes. The protests had prompted Prime Minister Shehbaz Sharif to announce a three-month, Rs50 billion subsidy for electricity consumers using up to 200 units a month.
